Last Updated on
It isn’t without a reason that the United Arab Emirates is one of the biggest business center today; many business owners, as well as those wishing to set up their businesses, come to Dubai for the same because the country not only has a flourishing economy which more or less assures them of high profits and returns on investment but also because the country’s political framework is such that it makes it an easy and hassle-free process to set up a business, irrespective of the nature of its activities.
When it comes to running a successful business, it is important to ensure that all the departments and thus, all the employees are working in conjunction with each other so as to achieve common goals and targets. There are a number of operations simultaneously going on in a company at once, such as marketing, strategizing, human resource management, research, management, accounting, etc. Without all of them working at their optimum levels, it would become difficult for the company to function smoothly, but, it is also important to keep in mind that while all of them are crucial operations, it is perhaps accounting/ bookkeeping and the management of finances that are slightly more important.
Importance of bookkeeping for a business?
When operating a company, there is a lot of money generated, and there is a constant flow of the same, whether incoming or outgoing. In order to keep track of the above and to ensure that the company is sound financial, it is imperative that the finances are efficiently managed, and that is precisely why bookkeeping is necessary. It refers to the process of systematically organizing all the financial transactions and related data, which includes receipts, payments, discounts, invoices, sales, tax invoices, etc.
Unless a bookkeeper does the above-mentioned work, there would be no way of systematically organizing all the financial data and getting an idea of how the company is doing in terms of finances. Moreover, it is on the basis of these records that accountants can prepare comprehensive reports to provide a clear idea of your company’s financial situation, and can (a bookkeeper too can do so) help you find ways to cut down on extra expenditures, save money, allocate funds where required, can advise you on where and how much to invest, etc.
How to Handle Problems Faced by Clients Who Outsource Bookkeeping in Dubai?
While the process of bookkeeping is absolutely important for a business and cannot be done away with, it is also expensive, especially for a smaller and relatively newer business. In such cases, you can always choose to outsource the work since it will cost much less and will provide you with added flexibility. However, there might be times when you may face issues with the same, and here are some ways to help overcome them:
- Using Antiquated Systems/ Tools: When you outsource your work, you should find out how they are working. Often, bookkeepers use old tools such as Excel to record financial data, and this might be time-consuming. In such cases, it is better to switch to a newer, more modern system or tool. The best idea is to switch to an accounting or bookkeeping software since it would make the whole process a lot easier and faster, owing to the fact that it is designed specifically for this purpose.
- Manual Data Entries: Since there is a lot of different kinds of financial data generated with respect to a business, the bookkeeper would have to manually (or without any help) enter all the data and then prepare the records. In order to avoid any errors that might occur, and to reduce the bookkeeper’s burden, automation is a great way to go. You can always ask your banks or other clients to directly enter or upload all the necessary information directly onto the accounting software since that would be much faster and would also minimize the chances of errors while recording.
- Inadequate Training: There are chances that you have been getting your bookkeeping work outsourced by the same firm or individuals for a long time, and while they usually make it a point to stay ahead of any changes or improvements in the field, there are chances that did not happen. What that could lead to is errors in recording, taking longer to get the work done, being overworked because of using old technology, etc. To make sure that you get nothing but the best results, it is key that bookkeepers are kept ahead of all the changes in the field of bookkeeping. They must be taught to use the newest technology and must also be well-educated about any changes in laws pertaining to taxation, accounting, etc. so that they can work accordingly.
- Errors: While bookkeepers are humans too that are capable of making an error in transcribing or recording financial data, such errors can prove to be quite costly for the company, since they would provide an inaccurate image of the company’s finances, and depending on what the nature of the error is, you might end up thinking that you have more or less money than what you really have, might make an unnecessary investment, etc. To avoid such cases, it is best to hire bookkeepers, even outsourced, who are highly qualified, have tons of experience, and know-how to use the latest bookkeeping/accounting software.
Bookkeeping is an essential service when it comes to business, whether it operates on a small scale or a large scale. Without having a means to systematically organize and accurately record all the company’s financial transactions and related data, there are chances that there might be issues in the future, which could financially hurt your company. While it is true that there are possibilities of there being issues with bookkeeping, you must make sure to identify said issues on time and must be able to come up with the right solution to avoid any further problems.